Legal Ethics

DLA says it keeps a tight rein on partner who admits faking $69K in cab receipts at prior firm

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A former Sidley Austin partner who admits faking $69,000 in cab receipts found a new home at DLA Piper in Chicago 17 months ago, but the firm tells disciplinary officials it is closely scrutinizing his billable hours and expense reports.

The former partner, Lee Smolen, testified in his Illinois disciplinary hearing last week that he was in shock when he was forced to resign from Sidley about two years ago, Crain’s Chicago Business reports (reg. req.). “It was like your parents kicking you out of the house,” he said. “It was family.”

Smolen testified that he submitted faked cab receipts to offset legitimate client expenditures that required more paperwork, according to a prior story by Crain’s Chicago Business. “I was trying to achieve a work-life balance after I had missed my children’s lives,” he said.

In written testimony submitted on Monday, DLA Piper general counsel Peter Pantaleo said he monitors Smolen’s billable hours. In the six months ending in May, Smolen billed between 18 and 167 hours per month. At Sidley, he billed an average of nearly 300 hours a month, according to prior hearing testimony.

Jay Epstien, chair of DLA’s U.S. real estate practice, said he reviews Smolen’s expense reports, though the job is usually done by the local practice chair.

Sidley Austin discovered the faked cab receipts after becoming concerned about high client development expenses associated with Wells Fargo & Co., Smolen’s primary client, the stories say. He has not represented the bank at DLA Piper. Two Wells Fargo executives testified on Smolen’s behalf, vouching for his integrity and hard work.

“We would certainly do business with Lee when this situation is behind him,” testified Mark Myers, an executive vice president who oversees Wells Fargo’s commercial real estate lending.

Legal Profession Blog links to an amended complaint in the case that, according to Crain’s, drops charges that Smolen charged Sidley for restaurant gift cards that weren’t business-related. The blog also links to Smolen’s amended answer (PDF).

“Submission of fabricated taxi receipts,” the answer says, “was a poorly conceived short cut around the firm’s expense reporting procedures in order to secure more time to address his substantial and demanding commitments to the firm.”

Hat tip to Above the Law.

Prior coverage: “Ex-Sidley partner says $69K cab-fare reimbursement was used for firm-related purposes”

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